Tag Archives: auctions

Auction Day

Thinking Of Becoming An Auctioneer?

Tomorrow, Saturday 18 April is World Auctioneers Day, and to celebrate this ancient profession we’ve spoken to two of Harcourts top auctioneers about their start in the business and their advice to those budding auctioneers out there.

 

Why branch into auctions?

Grow your profile and your skillset
For you as an agent, there can be many personal benefits to start auctioneering.

With 23 years in the industry, and 17 of those spent auctioneering, Chris Kennedy, Harcourts National Auction Manager in New Zealand says auctions can help to build your profile, confidence and income.

“You can definitely build your profile as an agent, and good auctioneers certainly receive accolades.”

Chris Kennedy, Harcourts National Auction Manager - Talks about starting a career in auctioning

However, auctioneering isn’t as easy as some may believe says Chris, having spent many years coaching and training those new to the role.

“There’s the lure of a relatively good income, but too often I see budding auctioneers assume auctions are easy – well that’s because seasoned auctioneers make it look easy,” says Chris.

Behind the scenes, a good auctioneer is practicing weekly. Chris himself practices with playing cards, shuffling the deck, then throwing cards down and adding the numbers.  Chris continues to practice with cards, or by counting number plates, even after 17 years calling auctions.

What qualifications do you need to become an Auctioneer?

A current Real Estate Agents Licence

In both Australia and New Zealand, auctioneers require a current Real Estate Agents Licence. In some states in Australia, such as Queensland, you also require an Auctioneers Licence. Amongst other criteria, to get an Auctioneers Licence you perform five auctions under the supervision of another auctioneer.

Knowledge of the industry

But it doesn’t just stop at formal qualifications, says Chris who believes an aspiring auctioneer should have a clear understanding of the real estate business and a good understanding of what goes into and makes a good marketing campaign.

Negotiation skills and the ability to read a crowd

“It also about being a shrewd negotiator, because you need to be the best negotiator there on the day.”

Chris believes an auctioneer needs to be able to read the crowd, and be able to work with different personalities and backgrounds.

“Being bi-lingual too is a huge bonus, particularly in Australia and New Zealand with growing migrant populations”, says Chris.

What sort of personality suits auctioneering?

“Someone who likes people and has good people skills as you need to be able to read a crowd, a buyer and the seller” confirms Mitch Peereboom, Queensland Chief Auctioneer

Mitch Peereboom, Queensland Chief Auctioneer - Talks about how you can become an auctioneer

 

The ability to read and interact with people is crucial according to both Chris and Mitch, as you need to remain calm, negotiate well and make sure all parties are happy at the same time.

“An auctioneer is someone who is naturally gregarious – peacocks we’re sometimes called!” Chris jokes.

“In all seriousness though it’s someone who is outgoing, who can tell a story, who can inject a bit of humour into the call, but also someone who understands the serious side of dealing with someone’s most valuable asset”, says Chris.

What do you look for in a new candidate or junior auctioneer?

The key: A willingness to learn. “There is a lot for a novice to take in, and whilst someone may have an outgoing personality and desire to be an auctioneer, that doesn’t mean they’re prepared to call an auction”, says Chris.

Chris has seen many new recruits struggle through their first auctions, he himself admits his first auction wasn’t his best.

“I received half an hour of training, two days before my first auction – it didn’t go well.  It wasn’t enough training to say the least”, says Chris.

Before a new recruit is ready, Chris believes you also need to be able to think strategically, and understand the complex legal side of calling an auction.

How can you get started in auctioneering?

Both Mitch and Chris started their career whilst working in sales in real estate offices, but both took different paths from there.

Mitch started spending time with the chief auctioneer in his area, attending several auctions and learning the ropes with a mentor. Chris’ principal tapped him on the shoulder and threw him into an auction the next weekend.

However Chris advises that someone starting in auctions should take Mitch’s lead and work with a senior auctioneer, attend auctions with them and practice, practice, practice.

Also don’t underestimate training. At Harcourts, we have training programmes specifically for auctioneers, and Chris suggests attending these, as well as external training if need be, citing proper training as key when starting in auctioneering.

Key points to holding a good auction

  1. Rapport with the vendor – Building trust with the owner and making sure they understand that you’re on their side.
  2. Adaptability – You need to be adaptable and reactionary, as you may be dealing with different environments, noise from passing traffic, or weather and you need to be able to command the room or space over these distractions.
  3. Transparency – Be clear, concise, and transparent with the crowd. People need to feel comfortable.
  4. Connecting with buyers – You need to be able to read the room, and know what kind of buyers you’re dealing with. What drives them.

“You want buyers to be thinking with their hearts, not just their heads. It’s important to be able to connect buyers to the property emotionally. Buyers don’t really know how much they’re willing to pay until they’re there, and it’s up to you to use this knowledge and work with that fear of loss.

Robert Tolpe Winning Auctioneer

 

How can someone overcome nerves when they’re new to auctions?

Practice

 The best way is to practice, says Mitch. You can practice in front of a mirror, but also seek feedback on how you’re doing.

Chris uses famous speeches, or tongue twisters to prep before an auction, and advises practicing in front of your colleagues as this can be more of a challenge than reciting these on your own.

“It’s natural to be nervous in front of others, but do it often enough, and it becomes easier”, says Chris.

Mitch echoes this advice, agreeing that like anything nerve-wracking, after you’ve jumped in and done it, over time, it will become easier.

Chew gum

 Practically, Chris also says you can chew gum before calling an auction or use vocal lozenges which are popular among singers, to stop the mouth from drying out when speaking publicly.

Ease into it

Chris brings new auctioneers along to his auctions, so they become familiar with the structure.  He then slowly gets them involved, more and more with each auction.

First he’ll have the new auctioneer greet and welcome everyone to the day’s auction and acknowledge the sales consultant and vendor.

The next time Chris will bring the new auctioneer in to run through the rules and formalities of the auction, and the description of the property.

Eventually the new auctioneer will also take and add bids on the day, before calling an auction of their own.

Is it worth getting into auction competitions?

According to Chris, it is definitely worth it, and at Harcourts it’s encouraged.

The reason? “The amount of time spent practicing for a competition is huge”, says Chris, who has already started practicing for a competition he’s preparing for in June – three months away!

“The practice alone makes a competition worthwhile. I guarantee you that even if you don’t win a competition, the next auction you call will be your best – the preparation is that intense!”

Auction competitions are different to holding a real auction, but the preparation requires you to do your research, practice numbers, train your voice, listen and prepare and read through scripts – that kind of practice is invaluable.

“Sometimes I’ll hear an auctioneer doesn’t want to compete when up against stiff competition – but these are the auction comps you should compete in!

“These will challenge you to go the extra mile, and winning is possible. I’ve seen novice auctioneers win competitions after dedicating themselves to preparation… I’m talking a couple of hours a day”, says Chris.

It should be noted though that auction competitions are more regimented and scripted than the real thing according to Mitch.

“The limitations are they don’t represent what happens in the field, they’re not as reactionary, so you aren’t able to hone your negotiation skills, but they will certainly help to improve some facets of auctioneering”, says Mitch.

Auctioneering can be a rewarding and lucrative career path, but it isn’t without its challenges. With training, the desire to learn and a lot of practice, auctioneering could be your next role.


Selling at auction – Your guide to preparing for auction day

When selling your property, there are quite a few different modes of sale you can opt for. When it comes to the choice of selling your home through the auction process, the choice will be largely dependent on your country, and the type of property you have.

Higher end and luxury properties are often sold through auction due to the nature of Australian and New Zealand auctions focusing on the quality of the property, with price being the secondary concern. In this environment, keen bidders can drive the price of the property above market expectations in some cases, with no pressure to sell if the property fetches a lower than expected bid.

Another benefit to selling at auction, is that you will attract genuinely interested buyers. In Australia and New Zealand, those bidding at auction must do their due diligence before bidding. This means the contract of sale is not subject to inspections or finance – as these must be organised before auction day and ensures only serious buyers will show up to bid.

Once you’ve decided on auction for your property, how can you ensure you’re best prepared for the day? To help you, we’ve gathered a list of considerations and frequently asked questions from Harcourts top auctioneers.

Before the auction

Auctioning your property is about so much more than simply showing up on auction day. There’s a lot that goes into it before-hand to ensure you achieve the best result possible for your property. Marketing your property well is chief among the things you’ll need to do.

Your agent should walk you through your marketing plan in detail, from the images that’ll be selected and advertised, the copy that will be included, to where the property will be advertised (online, papers, brochures, in office).

Before you go to auction, you should expect to hear from your agent on a daily basis and a face-to-face meeting around once a week. Ideally, you’d receive a written report which summarises all of these activities as well as the interest in your property.

Your agent should also be keeping you well-informed of the market, so that you can make the best decision come auction day.

What is your role on the day?

If you’re in the country, the best recommendation is to attend your auction. It’s great to have you there if there are any last minute questions. Some common ones buyers ask are:

“Can we vary the deposit amount?” or “Can we vary the settlement date?”

Your auctioneer will also want to confer with you depending on how the auction is going. If bidding stops below your reserve price for example, your auctioneer will want to discuss next steps with you.

Getting to know your property

The auctioneer should be introduced to your property, much as your agent has been. They should walk through the property, understand the features of the home, and really understand why a buyer would fall in love with it. That way they’ll be able to better represent your home to buyers.

Your auctioneer will also want to know all about the interest the property has received. They’ll ask your real estate agent detailed questions about it. How many inspections have there been? What kind of interest has the home received? Have any valuations been done? Any building/pest inspections?

Marketing

When it comes to marketing your property before auction, the rule seems to be more is more. The success of your auction can be largely dependent on your marketing campaign. The latest research from Harcourts Group Australia, showed a direct correlation between the amount spent on marketing versus how much interest was generated for a property, and what price it sold for. On average, properties that sold in the shortest timeframe invested a further AUD$1,913 in marketing than those that did not see a sale in the 45 day period.

The reserve price

It’s important for you to understand and be clear on what your reserve price is, and how it’s used during the auction. Your auctioneer should be able to explain this to you in detail. You will need to discuss your reserve price with your auctioneer.  They should be working to ensure you get the best price possible for your property.

That being said, try to avoid openly discussing price with others, to reduce the risk of price leaking out into the market. The auction should focus on the product (your home), and price should become secondary.

Harcourts Auctioneer, Chris Kennedy believes there are three types of figures to consider before the day:

  • Your happy price – The figure you’d be very happy to accept.
  • Your ok price – The figure you’d be ok with based on the feedback you’ve received, you don’t see a win but you don’t see a loss.
  • Your grumpy price – This last figure is basically the one you wouldn’t be thrilled with, but given market conditions, you’re prepared to unhappily sell at that price.

Remember, at all times during an auction, you’re in control. If a bid is high enough take it. If not, don’t. But the reason for not taking the offer needs to be greater than the reason the home is on the market in the first place.

Chris discusses the auction process in New Zealand in the following clip.

 

Frequently Asked Questions

  • What if no one registers for/turns up to the auction?
    Harcourts Auctioneer, Andrew North says, in reality, this isn’t something that happens very often. Both you and your agent will know well before auction day how much attention your property has received and how much interest there is, giving you a good indication of how many bidders are likely to show on the day.
  • What if nobody bids?
    It’s understandable that buyers might be nervous during the excitement and pressure of an auction. This is why it’s not uncommon for an auctioneer to be met with silence when asking for an opening bid. Most people are waiting to see what others at the auction might bid.  In the event that no one calls out an opening bid, the auctioneer will nominate a starting bid to get the ball rolling.
  • What if the reserve price is not reached?
    In this event, your auctioneer can pause the auction and come and speak to you, the seller. They will go back to the current highest bidder, and ask if they’re prepared to increase their offer to a price at which you’re prepared to sell. If the bidder is not prepared to do that, your auctioneer will then see if you’re prepared to lower your reserve price. That’s why it’s important for you to have a price in mind that whilst you wouldn’t be entirely happy with, you are prepared to sell at. If neither of these scenarios happen, then a sale cannot occur, and your home will be what is called ‘passed in’.
  • What happens when the property sells?
    After the sale, it’s time to focus on the buyer. Your auctioneer should take them aside to start looking at the paperwork and get the contract signed straight-away. It’s also time to look at how the deposit is going to be paid. As the current owner, you’ll then sign the paperwork, and the sale has concluded.

 

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Where Should You Hold Your Property’s Auctions?

Most now understand that in a high demand, low supply property market auctions are the best way to achieve top price when selling.  If you choose to auction your property, one of the next decisions you may be faced with is whether to auction “in rooms” or “on site”.

Your sales consultant and auctioneer can advise you on this, however you may like to consider the following:

Auction “in rooms”:

• Provide the most controlled, business-like environment for an auction
• You are more likely to have a larger audience if more than one property is being auctioned on that occasion
• There are no distractions such as bad weather, disruptive neighbours or noise
• You can access private offices for negotiation
• Your sales consultant and auctioneer will have all the resources they need to work for the best results (e.g. power point presentations, seating, lighting)
• Buyers attracted to the auction by another property may see and become interested in yours.

“On-site” auctions:

• Can appeal to the spontaneous buyer.
• Give the property atmosphere and emotional involvement that cannot be duplicated in rooms
• Allow bidders to see and experience first-hand what they are buying